HUMAN RESOURCE MANAGEMENT PRACTICE - Fichier PDF

710 ❚ Rewarding peoplecan also be prospective: ‘We will pay you more now because we believe you havereached a level of competence that will produce high levels of performance in thefuture.’ARGUMENTS FOR AND AGAINST INDIVIDUALCONTINGENT PAYArguments forThe most powerful argument for individual contingent pay is that those whocontribute more should be paid more. It is right and proper to recognize achievementwith a financial and therefore tangible reward. This is preferable to paying peoplejust for ‘being there’, as happens in a service-related system.The e-reward survey of contingent pay (2004b) found that, in order of importance,the following were the main reasons given by the respondents for using contingentpay:1. To recognize and reward better performance.2. To attract and retain high quality people.3. To improve organizational performance.4. To focus attention on key results and values.5. To deliver a message about the importance of performance.6. To motivate people.7. To influence behaviour.8. To support cultural change.Arguments againstThe main arguments against individual contingent pay are that:●●●●the extent to which contingent pay schemes motivate is questionable – theamounts available for distribution are usually so small that they cannot act as anincentive;the requirements for success as set out below are exacting and difficult to achieve;money by itself will not result in sustained motivation – as Kohn (1993) pointsout, money rarely acts in a crude, behaviourist, Pavlov’s dog manner;people react in widely different ways to any form of motivation – it cannot beassumed that money will motivate all people equally, yet that is the premise onwhich contribution pay schemes are based;